EPA Excludes Biofuels From Vehicle GHG Plan, In Sector’s Latest Blow

Source: By Stuart Parker, Inside EPA • Posted: Wednesday, August 11, 2021

EPA’s near-term proposal to curb greenhouse gases from light-duty vehicles entirely excludes any discussion of biofuels as a means to limit emissions, in the latest blow to biofuels advocates who are promoting higher biofuel blends as a faster and easier way to cut GHGs than reliance on electric vehicles (EVs).

The proposed rule, unveiled Aug. 5, is part of a broader administration effort that will include trucks and long-term light-duty standards, mandated by a new executive order (EO) by President Joe Biden that seeks to slash GHG emissions from transportation.

Biden set a goal to make 50 percent of new light-duty vehicles to be battery EVs, plug-in hybrids or powered by fuel cells by 2030.

But neither the proposal nor the EO mentions a role for biofuels in reducing GHGs or conventional air pollutants such as nitrogen oxides (NOx), despite a late lobbying push by the “High Octane, Low Carbon Alliance” of biofuel and agricultural groups. The proposal covers vehicles from model year 2023-2026, after which EPA plans a more “robust” GHG rule.

The “Alliance was disappointed to see that the EPA chose not to use the proposed rule as an opportunity to open the door to higher octane lower carbon fuels,” the group told Inside EPA Aug. 6.

“We believe this was a missed opportunity for helping to address our climate, public health, and environmental justice challenges. We look forward to continuing to engage the administration on these critical issues and commenting on the proposed rule.”

The Alliance, represented by former Senate Democratic leader Tom Daschle (D-SD), urged the White House Office of Management and Budget (OMB) to include in the rule a role for higher biofuel blends than the 10 percent (E10) and 15 percent (E15) blends now authorized for general use. Higher blends, such as E30, allow for higher-octane fuel and more-efficient engines that emit less carbon dioxide.

The Alliance’s push is also supported by governors from biofuels-producing states.

Biofuels advocates say EPA now greatly underestimates the GHG benefits of biofuels, and that increased biofuel use is possible in the near-term using existing fueling infrastructure. But some environmentalists doubt the benefits of biofuels, favoring a fast rollout of EVs that release no tailpipe emissions.

Reacting to the light-duty vehicles corporate average fuel economy (CAFE) announcement, Growth Energy, an ethanol advocacy group and proponent of biofuels as a near-term GHG control measure, urged the Biden administration to do more to support biofuels.

Growth Energy CEO Emily Skor said, “In order for the proposed CAFE standards to effectively address climate change, this rule needs to include a pathway to increase the use of low-carbon, sustainable biofuels like ethanol in our nation’s fuel supply. We will be providing the Biden Administration a pathway forward that allows biofuels like ethanol to help us meet our climate goals.”

All-Of-The-Above Approach

And the Renewable Fuels Association (RFA), a member of the High Octane, Low Carbon Alliance, said “decarbonizing our nation’s fuels and vehicles is going to take an all-of-the-above approach that stimulates growth in all available low-carbon technologies. The overarching goal should be to reach net-zero emissions as quickly as possible without dictating the pathway to get there or putting all our eggs into one technology basket.”

RFA adds, “We believe any plan to decarbonize the transportation sector should recognize the massive opportunity for low-carbon liquid fuels like ethanol to reduce GHG emissions from internal combustion engines in the near term.”

The group says this is simply based in the reality that liquid fuels will remain dominant in the market for years to come. “Even if half of new vehicles sold in 2030 are electric, four out of every five cars on the road that year will still have internal combustion engines that require liquid fuels. Renewable fuels like ethanol offer a solution that is available right here, right now at a low cost to jump-start decarbonization efforts.”

RFA wrote to Biden July 27 making a “net zero” commitment on behalf of its members to “ensure that ethanol reduces GHG emissions by at least 70 percent, on average, when compared directly to gasoline,” by 2030, and by 2050 to ensure that ethanol achieves net-zero lifecycle GHG emissions, on average.

The absence of measures to boost biofuels in the proposed light-duty vehicle rule is the latest setback for biofuels producers faced with adverse court rulings. For example, the Supreme Court in June ruled that EPA may give small refiners waivers from renewable fuel standard (RFS) compliance even if they lacked such waivers in prior years.

The RFS, which divides both Democrats and Republicans on regional, rather than party lines, sets annual biofuel blending targets, but EPA is already months behind schedule in issuing volumes for this year, with talks over a proposed volumes rule seemingly stalled at OMB over political considerations.

And the U.S. Court of Appeals for the District of Columbia Circuit ruled July 2 to overturn the Trump EPA’s authorization of E15 for sales in summer when tougher fuel volatility limits apply to curb air pollution.

RFA in an Aug. 4 analysis says the E15 ruling, if allowed to stand, could result in a huge loss of ethanol sales. The report finds that the ruling could result in a net loss of ethanol sales of 630 million gallons valued at $1.3 billion between 2021 and 2024, with further large losses thereafter.

RFA President and CEO Geoff Cooper said, “one misguided court decision threatens to strand billions of dollars in public and private investment, reverse the progress we’ve made on E15, and foreclose on one of our industry’s largest future growth opportunities. As this new report demonstrates, the potential cost of losing that growth opportunity is enormous — and that’s why we can’t let it happen.”

But ethanol advocates’ options are limited, with prospects for rehearing or Supreme Court appeal of the decision unclear, and substantial obstacles to any legislative solution, given the politically divisive nature of the RFS. EPA might also devise regulatory solutions, Cooper has suggested, but this would require political will, take time, and run the risk of further litigation. — Stuart Parker (sparker@iwpnews.com)